Second-quarter revenue growth had been projected to be in the mid-single digits, the company said.

"The company believes this is a temporary softening in revenue and is confident about its ability to grow," the Texas-based consulting group said in a statement.

EDS said revenue growth will increase and continue to improve in the second half of this year. It also expects to meet analysts' expectations for the current quarter, which ends June 30, and fiscal year 2000. According to First Call/Thomson Financial, the earnings estimates are 53 cents per share for the quarter and $US2.28 per share for the year.

As a result of EDS's warning, its stock price plunged $14.06 to $43.75 on the New York Stock Exchange during Friday trading, a 26 per cent tumble.

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